How paid family leave has worked in New Jersey

When she had her first child 13 years ago, Tina Gunderman made the pragmatic choice of returning to her job as a project manager two months after giving birth

When she had her first child 13 years ago, Tina Gunderman made the pragmatic choice of returning to her job as a project manager two months after giving birth — when the temporary disability checks stopped coming.

But when her second arrived in 2009, New Jersey threw her the lifeline she needed to make the heartfelt choice: being a full-time mom for an extra six weeks. That was the year the state introduced paid family leave — providing income while she cared for and cuddled her infant daughter a bit longer.

Advertisement

"I got to spend a lot of time with the baby that I wouldn't have been able to do otherwise," said Gunderman, 48, of Harmony Township, Warren County. "It helped me to bond with her. There wasn't a lot of stress because I wasn't worried about the bills."

Gunderman is one of just 13 percent of private employees nationwide with access to paid family leave, according to the U.S. Bureau of Labor Statistics from March 2016. The United States is the only industrialized nation not to offer paid family leave. It's something that could change under a vague federal paid family leave proposal tucked in President Donald Trump's inaugural budget.

Advertisement

The program would require states to provide the benefit under existing unemployment insurance programs unless states already have their own. For a peek at how such programs work, the Lehigh Valley need only look across the Delaware River.

New Jersey's 8-year-old program, modeled after California's, ensures workers' checks keep coming as they take up to six weeks off to care for a newborn, newly adopted child or close family member who is ill.

The cost is shouldered completely by workers at an average of 50 cents a week. The 0.1 percent payroll tax can't exceed $33.50 a year. Companies with fewer than 50 employees do not have to guarantee workers will have a job waiting for them when they return, however.

The insurance plan pays the individual about two-thirds his or her salary up to $633-a-week, the equivalent of a $32,900 salary. Once a doctor clears a new mom to go back to work, the benefits she receives from short-term disability end, and the New Jersey family leave benefit kicks in.

New fathers also are eligible, and the leave doesn't have to be taken immediately after a birth or on consecutive days. The law allows up to 42 days within a year of the date the benefit kicks in, provided notice is given to employers.

Supporters say the leave provides income to new parents without placing a cost burden on employers. But critics say the program could hurt businesses that must spread out work among other employees, or train temporary workers while competing with companies in other states that don't have the benefit.

New Jersey Policy Perspective, a Trenton think tank that supports the benefit, reported in April that there were 203,000 insurance claims approved during 2009-15, paying out $507.1 million in benefits.

Studies show women use the benefit more, mostly for bonding with children. Four-fifths of the claims were paid to parents of newborns or newly adopted. Women made up 86 percent of all eligible claims.

New Jersey's program isn't as popular as the other two states with paid leave. Twelve percent of those eligible use the benefit in New Jersey, while 17 percent in California and 13 percent in Rhode Island do, according to the Public Perspective group. New York will begin offering the benefit next year, and Washington, D.C. is scheduled to roll out one in 2020.

"In New Jersey, we were certainly ahead of the curve in family leave and it was a long political fight," said Jon Whitten, vice president at Policy Perspective, referring to a decade-long effort. "What we ended up with was the best thing to happen at that time."

But in looking at the data, he said improvements could be made.

Consider this: A $15-an-hour full-time employee makes $600 a week. On leave, the worker would receive $400 weekly, something he said an already struggling and growing family could ill afford.

Advertisement

The lost income stresses the middle class, too. Perhaps a single-parent family in New Jersey is living on $1,000 a week. Because the benefit maxes out at $633 weekly, that family would have to shave $367 from weekly expenses even while the birth adds the cost of diapers and other baby expenses to the shopping list.

Comparatively, California's weekly cap is $1,173 and Rhode Island's is $817, according to Policy Perspective.

That income gap resonates with Michelle Altieri, a communications professor at the County College of Morris. After crunching the numbers while expecting her first-born in 2010, she decided against taking the paid leave.

"We are very carefully budgeted and couldn't afford to take that much of a hit for a few weeks," she said.

For her second child, she planned for a June 2014 birth so she had time to bond before returning to teach in the fall semester.

There seems to be some appetite among New Jersey Democrats to fix what they see as shortfalls in the promise of paid family leave. Senate President Stephen Sweeney, who authored the original law, is looking to bump the weekly maximum to $800 and double the benefit to 12 weeks.

And this week, state Assembly Speaker Vincent Prieto called for doubling the benefit and raising the cap to $932 weekly.

"We wanted to set it up so that if your really need it, it's here but don't abuse it," Sweeney said. "But the other part of that is that we made it too hard. There wasn't enough for people to live on without falling too far behind."

The New Jersey Business and Industry Association has put up red flags over paid family leave since it was proposed more than a decade ago.

In a statement this week, the association said it's still developing its position on the House proposal.

"While it is important that employees have the flexibility to take leave for family reasons, potential expansion of the current law must always take into account our members' ability to perform vital functions with fewer staff and also the potential additional costs involved for those business owners who may now just be operating at the margins," its statement said.

The current law gives companies some options to work with on family leave. Companies could require employees to take some of their accrued vacation or sick time as part of the six-week paid leave. That would give employees more money during their time off, but also would reduce the number of days an employee could take off that year.

A survey by the Employers Association of New Jersey in 2010 indicated 51 percent of its members required employees to use their days off.

DETAILS

Who is eligible: New Jersey workers

Advertisement

The benefit: Two-thirds of the worker's salary, up to $633 weekly, for up to six weeks

When it can be used: To care for a newborn, newly adopted child, ill family members